A government plan to make 2011 "the year the electric car took off" appears to have stalled, with uptake of a scheme to promote sales of environmentally friendly vehicles falling dramatically.

The "plug-in car grant", conceived under Labour and launched by Philip Hammond in January when he was Transport Secretary, offered an incentive of up to £5,000 to buy an electric car.

The number of vehicles sold through the scheme has dropped significantly since its launch, with only 106 being bought in the third quarter of 2011, down from 465 in the first quarter of this year, and 215 in the second. Despite an increase in the total number of electric cars being sold in Britain – from 167 in 2010 to 940 in 2011 according to the Society of Motor Manufacturers and Traders – environmental campaigners have criticised a lack of infrastructure for its failure.

The Coalition Government agreement promised a "national network" of charging points, but a subsequent report by the Department for Transport said such a network would be "under-utilised and uneconomic", and recommended that consumers should charge at home instead.

Lewis Merdler, Environmental Protection UK's healthy air campaign manager, said the scheme's slow adoption showed the Government "needs to do more to incentivise consumers, like introducing tougher low-emission zones in cities, to make zero-emission vehicles a more attractive option".

Transport minister Norman Baker blamed the poor figures on the lack of suitable electric cars. "It is the availability of qualifying cars rather than the public appetite for them that is the main challenge we face in developing the electric car market," he said.